Tata Power Wednesday said it has signed a share purchase agreement (SPA) for acquisition of 100 percent shareholding in Nagpur-based Ideal Energy Projects Limited (IEPL).
"An agreement was reached between Tata Power and IEPL for sale of 100 percent stake in IEPL. The acquisition is subject to statutory approvals and certain conditions precedent," the company said in a filing to BSE.
Based on domestic coal, the 540 MW plant in Nagpur saw 270 MW commissioned on May 2013. IEPL had been looking to sell the project since 2011.
With this acquisition, Tata Power's total generating capacity will increase to 8,885 MW.
"We are happy to announce our intent to acquire this project in Maharashtra," Tata Power managing director and CEO Anil Sardana said in a statement.
Tata Power has set a target of generating 18,000 MW by 2022 and presently has projects of about 3,000 MW capacity which are under various stages of execution.
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IEPL is promoted by members of Mhaiskar family of IRB Infrastructure Developers Ltd, an infrastructure constructions company. IRB Infrastructure, which executed the country's first build-operate-transfer road project, is one of the largest operators of such ventures.
Shares of Tata Power traded Rs. 87, up 1.6 percent on the BSE.